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LOOK FORWARD TO MORE CHOICE

MORE FREEDOM A guide to Income Release

Pens

ion

Port

folio

A GUIDE TOINCOME RELEASE2

CONTENTS

Baffled by anything in this guide?

We’re an old-fashioned bunch and being helpful and straightforward are principles we’ve kept since the olden days. So if you have any questions about your plan, just get in touch. We’d love to hear from you.

03 WelcomeA few words from our CEO

04 How a pension worksA reminder of the benefits pensions offer

06 Share our successHow your ProfitShare works

08 Your retirement optionsSorting out your financial future

12 Clear chargesProduct charges

13 Investing your retirement savingsDeciding where to invest your retirement savings

15 Flexible savingKeeping your retirement plans on track

17 Your plan online Getting to grips with your pension

18 Getting in touch Always on hand to help

A GUIDE TO INCOME RELEASE 3

3

“You’re now a member of the UK’s largest mutual

life, pensions and investment company.”

I’m delighted to welcome you to Royal London.

When we first opened our doors in 1861, we wanted to help people to help themselves. And it’s been our way of thinking ever since.

Proud to be differentWe’re a different kind of financial services company because unlike our main competitors, we’re a mutual. This means we don’t have shareholders. Instead, we’re owned by you and our other members.

This means you can have your say on the future of our business by voting at our Annual General Meeting (AGM) and you’ll share in our success.

What’s so great about mutuality?Having no shareholders means we don’t have dividends to pay. Instead, we use our profits to boost your retirement savings and provide you with better products and services.

I believe this has helped us build a strong reputation for providing an Excellent Service. You can be sure that absolutely everything we do is for the long-term benefit of you and our other members.

This guide tells you more about how your plan works and the benefits it offers. I hope it helps you get the most out of your retirement savings.

Isobel LangtonCEO, Royal London

Intermediary

A GUIDE TO INCOME RELEASE4

HOW APENSION WORKS

Youcontribute

�e taxmancontributes

Your retirement savingsare locked away so you

can’t dip into them

Your retirement savings are invested

Helps yourmoney grow

Reviewed by experts

You can start taking your retirement bene�ts

any time after age 55

Buy an annuityTransfers from

other plans

Pro�tShare

Single contributions Flexible access

to your savings

Income payments directly from your plan

Tax-freecash

You’ll receive extra contributions into your planEach time you save into your plan, so will the taxman. This is called tax relief; it depends on individual circumstances and may change in the future. This will help to boost your retirement savings.

Top up your retirement savingsYou can make single contributions into your plan at any time. So if you find yourself with spare cash, you could add it to your plan.

Have all your retirement savings in one placeYou may be able to transfer retirement savings from other pension plans.

This will make it easier for you to keep track of them. Currently, if you have a drawdown pension plan with another pension provider, you can transfer it to us, but it must be held in a separate plan. This is due to Government legislation. Transfer payments from one pension plan to another don’t receive tax relief and aren’t always in your best interests. You should speak to your financial adviser before you make a decision.

Share our successWe’ll aim to give your retirement savings an extra boost by adding a share of our profits to your plan each year. So if we do well, so do you. We’ve called this your ProfitShare.


Youcontribute

�e taxmancontributes

Your retirement savingsare locked away so you

can’t dip into them

Your retirement savings are invested


Reviewed by experts

You can start taking your retirement bene�ts

any time after age 55

Buy an annuityTransfers from

other plans

Pro�tShare

Single contributions Flexible access

to your savings

Income payments directly from your plan

Tax-freecash

Your retirement savings are invested to help them growYou can stick with the investment you chose with the help of your financial adviser, or refine it to suit your changing circumstances. Remember that investment returns are never guaranteed. So you could get back less than you put in. You can find out more at royallondon.com.

Our investment options are reviewed by expertsThis helps make sure they meet their objectives. This ongoing governance comes at no extra cost to you.

Take your retirement benefits in a way that suits youIncome Release allows you to take regular or one-off tax-free cash and/or income payments directly from your plan when you need it. Unlike an annuity, income payments are not guaranteed for the rest of your life. Both the value of your plan and your payments may go up or down. To access Income Release there’s an initial one-off charge which covers our costs in setting up and administering your Income Release Account. However depending on when you switch on Income Release and where you’re transferring your retirement savings from, we may not apply this charge.If you want to take a guaranteed income for life, the proceeds of your plan can be used to buy an annuity.

http://royallondon.com


SHARE OURSUCCESS

Review �nancial

strength and performance

Decide ifPro�tShare

will beawarded

Tell youabout your Pro�tShare

award

Your Pro�tShare award is invested

Pro�tShareaccount


Take yourpensionbene�ts

How ProfitShare worksWe’ll review our financial strength and performance at the end of each year to decide if ProfitShare can be awarded. You’ll qualify for ProfitShare so long as your plan was in force at any time during the year.We aim to award between 0.15% - 0.25% of the value of your plan on 1 April the following year, so long as your plan is still in force. Over time, this will help to boost your retirement savings. You could get more or less than this and there’s no guarantee that we’ll be able to award ProfitShare every year. We’ll write to let you know what your ProfitShare award will be and we’ll add it to a separate ProfitShare account within your plan in April.

It will be based on the value of your plan at the date of the award and will be invested in the same investment choice as your other retirement savings to help it grow. You’ll see the value of your ProfitShare account every year in your statement and you can take the value of your ProfitShare account along with the rest of your retirement benefits any time after age 55.ProfitShare doesn’t apply to Self Investments.

What’s the catch?There isn’t one. The ProfitShare you’re awarded will belong to you. We’ll never ask for it back.


YOUR RETIREMENT

OPTIONSIf the thought of sorting out your financial future is leaving you feeling a little perplexed, you’re probably not alone. The good news is, our plan has been designed to give you full flexibility over when you can start to take your benefits, even if you’re still working. Here you’ll find more information about your options.

More control over your savingsIncome Release gives you a flexible alternative to buying an annuity. You can choose how to take your benefits in a way that suits you.

You do not need to use your entire plan for Income Release. You can decide how much to use, based on your own individual requirements.

You can choose from:

• Regular tax-free cash payments

• Lump sum tax-free cash payments

• Regular income payments

• One-off income payments

• A combination of tax-free cash and income payments.

Taking your retirement benefitsIf you take your benefits as regular tax-free cash or as a combination of tax-free cash and income payments, they can be paid either monthly or yearly. And they can be stopped or started at any time.

Once you’ve used up all of your tax-free cash, any future payments you receive will be treated as income payments.

Income payments can be paid monthly, quarterly, half-yearly or yearly. Or on a one-off basis. These payments will be subject to income tax.

Whilst the income payments are not guaranteed for the rest of your life, you have the flexibility to start, stop, increase or reduce your income at a time that suits you. You can also change the frequency of your income payments.

We’ll write to you when you’re close to your chosen retirement date with more information about your options.


Remember you don’t have to take income payments from your plan – the choice is yours. This gives you greater control over your savings. However, the income payments from your plan aren’t guaranteed for life.

Depending on the amount of income you’ve taken and the performance of your investments, both the value of your plan and any income you take from it could reduce in the future. So it’s important to regularly review the income you take and the value of your fund to ensure it’s sustainable.

Use our income management facility If you’re taking an income, you might want to think about using our income management facility – Income Tap. This is a low risk fund that’s suited to helping make income payments and can hold up to 60 months’ worth of income. To find out more download our Income Tap leaflet from royallondon.com.

How Income Release works Once you’ve decided how you want to take your retirement benefits, we’ll split your retirement savings between two separate accounts: an Income Release Account and a Savings Account.

The Income Release Account pays out the tax-free cash and any income payments that you’ve selected. If you decide to put all your retirement savings into the Income Release Account, you won’t have a Savings Account unless you make additional contributions to your plan. Once your savings are in this account you can’t move them back to the Savings Account.

The Savings Account holds any of your savings not put into the Income Release Account. It’s also where any additional contributions you make to your plan will be invested. Any time you need more tax-free cash or income, you simply move some or all of your savings into your Income Release Account. You can’t withdraw an income directly from your Savings Account, but you can use it to buy an annuity.

http://www.royallondon.com


Making your decisionDon’t worry if you haven’t made up your mind yet – your financial adviser can help you to decide.

Know your limitsFlexi-access drawdown plans allow you to take the level of income you want from your plan. If you take an income from a flexi-access plan, the money purchase annual allowance (MPAA) will apply to you.

Capped drawdown plans had to be in force by 6 April 2015 and had a maximum level of income you could receive from your plan. If you’re currently receiving an income from another capped drawdown plan, it may be possible for you to transfer the value of that plan to a Pension Portfolio plan and continue taking an income from it.

Your income level can remain capped if you wish. You’re not restricted to this limit and if you take an income higher than the capped amount, your plan will become a flexi-access drawdown plan and the MPAA will apply to you.

There’s also a limit to the amount you can have built up in this or any other pension plan when you start taking your retirement benefits. It’s set by the Government and it’s called the lifetime allowance. If you want to find out more, visit our website at royallondon.com.

REMEMBERYou can buy an annuity at any time if you decide you want a guaranteed income. Annuity rates can change, so there’s no guarantee that if you buy an annuity in the future, the rates will be more favourable – so you could receive a lower income than you expected.

http://www.royallondon.com


CLEARCHARGES

With Income Release, you only pay for the services you use.

Your chargesLike all pension providers, we apply a management charge for setting up and servicing your plan. However, as Income Release is part of Pension Portfolio, we’ve been able to minimise the charges you have to pay when taking benefits from your plan.

An initial one-off charge may apply when you first use the Income Release functionality to cover our costs in setting up and administering your plan.

Your financial adviser may agree an adviser charge with you to pay for the services they provide you with – both now and in the future. This agreement will be between you and your financial adviser. However, if you ask us to, we can deduct an adviser charge payment from your plan and pay it to your adviser.

Have a look at your Plan certificate for a breakdown of your plan charges.


INVESTING YOURRETIREMENT

SAVINGS Today there are more investment choices than ever before. While choice is a good thing, you might find it difficult to decide on the best option for you. Here are a few things to consider when deciding where to invest your retirement savings.

How much risk are you willing to take?Higher risk investments can help your money grow more. But there’s also a greater chance of losing money. And with lower risk investments, your money may not grow as much as you want it to. Remember that investment returns are never guaranteed. So you could get back less than you put in.

You can get an idea of your attitude to risk by using our risk profiler at royallondon.com.

How involved do you want to be?If you want to be actively involved in selecting your investments, you can use the Self Investments option within your plan. This lets you invest in a fund supermarket and directly in a range of alternative investments, such as company shares and UK commercial property. Further charges apply for these investments and they’re not suitable for everyone.


A GUIDE TOINCOME RELEASE14

Stay with your original investment choiceWhen you set up your plan, you had the option to choose, with the help of your financial adviser, the investments that matched your attitude to risk and your plans for the future. You can stick with your original investment choice. Or, you might want to change it.

Choose from the Governed RangeThis consists of Lifestyle Strategies and Governed Portfolios.

• They’re made up of a mix of different investments.

• They take into account the time until you retire.

• They suit different attitudes to risk.

If you’re taking income from your plan, we offer five Governed Retirement Income Portfolios (GRIPs), designed exclusively for Income Release. GRIPs are suitable for you if you’re taking a regular income but delaying purchasing an annuity and you’re able to accept a level of uncertainty in your future income.

Each GRIP invests in a mix of equities, corporate bonds, medium index linked gilts, high yield bonds and property. They are aligned to five risk profiles determined by your income needs and risk attitude.

Choose from the fund rangeYou can access Royal London funds, managed by the Royal London Asset Management team, as well as funds managed by some of the world’s leading investment companies.

Find out moreFor more information about the full range of investment options available to you, read our Pension investment options guide.

Remember to check with your financial adviser before you make any investment decisions, as any changes could affect your plan’s performance. Investment returns are never guaranteed. So you could get back less than you put in.

HOW TO

Change your investmentsIf you’re registered for our online service, you can change your investments online. Details on how to register for our online service are in the Your plan online section of this guide.

Any changes to Self Investments must be submitted by your financial adviser on your behalf.


FLEXIBLESAVING

We’ve all been there. The car needs a service. The bills are mounting up. And then the boiler breaks down. Managing your finances isn’t always easy. So we’ve worked hard to ensure saving into your plan is as easy and flexible as possible.

You can make regular monthly or yearly contributionsThese can be a fixed amount or set to increase each year in line with your salary or earnings, the Retail Prices Index (RPI), or set at a level between one and ten percent. Increasing your contributions each year will help you to increase the final value of your plan.

Your regular contributions are made by Direct DebitYou should make sure you don’t go below the current minimum, as shown in the diagram below.

Monthly contributions

£50

Yearly contributions

£600


Freedom to change your contributionsYou can increase, decrease, stop and restart your contributions at any time. And whilst no further regular or single contributions can be made to your plan once you reach age 75, you can make transfers into your plan after this age. But remember that any changes to your contributions will affect your retirement benefits. If you want to change your contributions, you should speak to your financial adviser.

Keep your retirement plans on trackLike any savings plan, your pension needs to be reviewed regularly. It’s the only way you’ll know if your retirement plans are on track.

KNOW YOUR LIMITSThere’s a limit to the amount you can invest in pension plans every year before you’re taxed. It’s set by the Government and it’s called the annual allowance.

If you want to make contributions to your plan after you’ve taken some or all of your retirement savings, you may be limited to what you can continue to contribute and receive tax relief on. This is called the money purchase annual allowance. Please note that this is considerably lower than the annual allowance and relates to any pension plan you may have, not just this one.

To find out more about the annual allowance and the money purchase annual allowance, visit royallondon.com.



YOUR PLANONLINE

Our secure online service is simple to use, quick and easy to access and available 24 hours a day, 7 days a week. So you’ll have round the clock access to your plan details.

Keeping trackOnce registered you can make changes to your investment choice and view a wide variety of information including:

• the value of your plan

• where your retirement savings are invested

• your contribution details

• the potential value of your plan when you retire

• contributions made and allocated

• the value of your pension plan and your investment holdings

• investment information including fund performance and fund information

• projections of future benefits

• personal details such as your address.

HOW TO REGISTERRegistering for our online service can be completed in a few easy steps.

1. Have your plan number to hand.

2. Go to royallondon.com/onlineservice.

3. Complete your personal details and click ‘Continue’.

4. Enter your email and password.

5. Select three different memorable questions and answer them, then click ‘Continue’.

6. You’ll then be sent an email to activate your account. Click the ‘Activate account’ link which will take you to the final step to enter your password.

Once you register, you’re ready to go – all you need to do is log in

http://royallondon.com/onlineservice

http://royallondon.com/onlineservice


Providing an excellent service is our bread and butter. That’s why our central Customer Service team is always on hand to help.

You’ll find the contact details for our central Customer Service team in your Plan details.

They can provide you with any information you need about your plan but they won’t be able to give you any financial advice. You should always contact your financial adviser first if you have any questions about your plan or your financial situation.

GETTING IN TOUCH

PLAN DETAILS Please tell us this number if you contact usYour plan number: 2800000

14 September 2015

Questions?Contact us on:

0345 60 50 050 Mon- Fri, 8.00am - 6.00pm

We may monitor calls toimprove our service.

[email protected]

royallondon.com/pensions

Here to helpWe'll use this margin toexplain some of the termswe've used.

Tax reliefYou get tax relief onyour regular and singlecontributions at the currentbasic rate. This meansthat each time you make acontribution into your plan,so will the taxman. If you payhigher rate income tax, youmay be able to claim extra taxrelief through your tax returnor by contacting your localtax office. Tax relief rates areset by the Government, aresubject to change and are notguaranteed.

Plan detailspage 1 of 6 NB04/999999//0

This document tells you how your plan has been set up. The following contributions havebeen set up under your plan:· Regular contributions

1 YOUR DETAILS

Mr David Wilson

Plan number:Plan type:Plan start date:Yearly statement date:Chosen retirement date:

2800000 Pension Portfolio with Income Release20 December 2015 20 December1 April 2030

2 CONTRIBUTIONS INTO YOUR PLAN

Regular contributions into your planFirst contribution: 20 December 2015

Expected monthly contribution: £250.00Made up ofYour contribution: £200.00Your tax relief: £50.00

Direct Debit informationWe will collect £200.00 on or around 1 December 2015 by Direct Debit and £250.00 on oraround the 1st of the month from then on.

3 ANNUAL ALLOWANCE

There is a limit on the amount of contributions you can make to a plan in any tax year,without being subject to a tax charge. This is known as the Annual Allowance.

If you take income or a cash lump sum from any plan, the total amount of contributions youcan make in any tax year, without being subject to a tax charge, may be limited by the MoneyPurchase Annual Allowance.

March 2017 65B11/11

Royal London1 Thistle Street, Edinburgh EH2 1DG

royallondon.com

All literature about products that carry the Royal London brand is available in large print format on request to the Marketing Department at

Royal London, 1 Thistle Street, Edinburgh EH2 1DG. All of our printed products are produced on stock which is from FSC® certified forests.

The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial

Services Register, registration number 117672. It provides life assurance and pensions. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL. Royal London Marketing Limited is authorised and regulated by the Financial Conduct Authority and introduces Royal London’s customers

to other insurance companies. The firm is on the Financial Services Register, registration number 302391. Registered in England and Wales number 4414137. Registered office: 55 Gracechurch Street, London, EC3V 0RL. Royal London Corporate Pension Services Limited is authorised and regulated by the Financial Conduct Authority and

provides pension services. The firm is on the Financial Services Register, registration number 460304. Registered in England and Wales number 5817049. Registered office: 55 Gracechurch Street, London, EC3V 0RL.


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